MB-920 Describe Dynamics 365 Finance Practice Question
You are a Dynamics 365 Finance consultant for a retail company that operates in multiple countries. The company uses Dynamics 365 Finance with the following configuration: The main legal entity is based in the United States (US), and there are subsidiary legal entities in Canada (CA) and the United Kingdom (UK). The finance team needs to generate consolidated financial reports that combine data from all three entities. Additionally, the company wants to automate the elimination of intercompany transactions during consolidation. The company also needs to comply with local tax reporting requirements in each country. The tax rates and rules change frequently, and the company wants to manage these changes without modifying the source code. You have set up the consolidation module and the tax engine. However, during the consolidation process, you notice that the intercompany transactions are not being eliminated, and the consolidated report shows double-counting. What should you do to automatically eliminate intercompany transactions during consolidation?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Configure elimination rules in the consolidation module to automatically generate elimination entries.
Elimination rules automate the removal of intercompany balances. Option A is wrong because manual journal entries are not automated. Option C is wrong because intercompany accounting is for transaction posting, not elimination. Option D is wrong because the consolidation online feature is for real-time consolidation but does not automatically eliminate.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Create manual journal entries to eliminate intercompany balances after consolidation.
Why it's wrong here
Manual entries are error-prone and not automated.
- ✓
Configure elimination rules in the consolidation module to automatically generate elimination entries.
Why this is correct
Elimination rules automate the elimination process.
- ✗
Set up intercompany accounting to post elimination entries automatically.
Why it's wrong here
Intercompany accounting posts transactions, not eliminations.
- ✗
Use the consolidation online feature to eliminate transactions in real time.
Why it's wrong here
Consolidation online does not include elimination logic.
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